A tax id is a taxpayer identifying number, a Federal Tax Identification Number. It’s the equivalent of an SSN for corporations and has multiple uses. You can use it to open a bank account or get a loan from a bank. Also if you don’t have an SSN, but need one because you want to work in this country (legally), then you should apply for an EIN instead of using your ITIN as the IRS will allow both numbers to co-exist. This way you won’t have to disclose your personal information to your employer and be at risk of identity theft etc.
Do I need a US tax id?
You will not necessarily need a US tax id, but it can be used as a substitute for your SSN and you’ll be able to open bank accounts and apply for loans more easily. Also if you don’t have an SSN, but need one because you want to work in this country (legally), then you should use an EIN instead of using your ITIN as the IRS will allow both numbers to co-exist.
How do I get a US tax id?
You can get a US federal tax id by filing form SS-4. There is no fee associated with applying for this online and it shouldn’t take longer than 10 minutes to complete the entire process and receive your new tax id.
You can visit the IRS website for more information on how to apply online says Aron Govil.
What is an SS-4?
Form SS-4 is a tax form that is used by American companies to get an EIN (Employer Identification Number) or ITIN (Individual Taxpayer Identification Number). It’s required in order to file your taxes in the United States, even if you’re living abroad and/or have foreign income, so it might be useful for you too. The application process takes around 10 minutes to complete. You’ll need basic personal information about yourself and the company you are trying to apply for an EIN for – just like when applying for a US tax id described above.
Advantages of having a US tax id
You’ll have an American taxpayer id which will probably help you open an account with some banks in the country. Also if you are intending to work in this country, then applying for an EIN instead of using your ITIN might be advantageous as the IRS has said that both numbers can co-exist so you won’t have to disclose your personal information on your W-2 unless it’s requested by law. Furthermore, each state is different and some might not allow you to get a state tax id without providing details of your SSN.
Disadvantages of having a US tax id
A US tax id number is only relevant to the US tax system and won’t be of any use for your home country. Sometimes even if you work in this country, they will not ask for a SSN, but only an EIN which you can get without having a SSN (or ITIN). Also if you do not plan on opening a bank account or getting a loan from one here in the near future it might be pointless to apply for an id number. Furthermore, each state is different and some might not allow you to get a state tax id without providing details of your SSN.
How should I fill out form SS-4?
If you’re not familiar with filling out American forms then I advise consulting an accountant as soon as possible as they should know how to help you out. Sometimes the instructions on the SS-4 website are not enough or they might even be misleading so keep that in mind.
How long does it take for EIN/ITIN application?
It can take up to 10 minutes once you have all of your papers ready. However, if there’s a problem with your identity then there might be a delay and it could take a couple of weeks – just like any other tax id application service. Be aware that sometimes you will have to upload certain documents in order to complete your form which can mean sending copies by fax for example, but this depends on where you live and what documents you need to send in.
A US tax id (or EIN) is a unique identifier that the United States federal government uses to identify taxpayers and businesses. You may also be required to obtain this number if you are engaging in any of the following:
- Selling goods or services;
- Carrying on regular business activities such as conducting meetings with potential clients, etc.;
- On an independent contractor basis;
- Operating a business through a corporation or other legal entity.
Conclusion by Aron Govil:
If you are working in the US then you will probably need to obtain an EIN (Employer Identification Number) but if not, your ITIN (Individual Taxpayer Identification Number) will do. You can either apply for each of these on their official website or with the help of a tax professional who knows what they’re doing.